Will carbon costs destroy the added value from refinery-petrochemical integration?​

An update to our Onsan refinery case study

1 minute read

Earlier this year, we published a case study exploring S-Oil’s decision to add steam cracking capacity to its Onsan refinery. In it, we crunched the numbers to see how incorporating increased chemicals production impacts overall site competitiveness, using net cash margin (NCM) to assess profitability.  

In the coming years, additional legislative pressures are expected to impact site margins, most notably government charges on carbon emissions. So in an update to our case study, we have used REM-Chemicals and PetroPlan to scrutinise the possible impact of carbon costs at the Onsan site.  

We also take a look at how a site with a higher degree of integration, Hengli, is affected by such charges.  

Our new study includes:  

  • CO2 emissions for refinery only sites and refinery chemicals​ sites 
  • NCM for Onsan and Hengli with and without carbon charges 
  • Pre-and post investment NCM for Onsan 

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